The U.S. Congress temporarily shut the door to Detroit's Big Three automakers request for a $25 billion emergency loan saying company CEOs have yet to make a case for the aid. Democratic leaders told General Motors, Ford and Chrysler LLC to "get their act together" and submit a viable turnaround plan for survival by December 2 and Congress would meet the week of Dec. 8 to reconsider the government aid. This of course means that even in the event that the automakers succeed in convincing congressional leaders, they won't receive the $25 billion loan until January at the earliest."Until we can see a plan where the auto industry is held accountable, and a plan for viability on how they go into the future, we cannot show them the money," said Californian Democrat Speaker, Nancy Pelosi. Senate Majority Leader Harry Reid said: "We're prepared to come back into session the week of December 8 to help the auto industry, but only if they present a viable plan."
The three CEOs, GM's Rick Wagoner, Ford's Alan Mulally, and Chrysler LLC's Robert Nardelli didn't exactly help themselves by flying into Washington on private jets as reported from several new sources including CNN, Telegraph and ABC News. Although the former Big 3 did not disclose how much the flights cost, analyst Richard Aboulafia of the Teal Group told CNN that "$20,000 is a legitimate ballpark figure for a round trip corporate jet flight between Detroit, Michigan, and Washington." That's compared to a $900 first class round trip from Detroit to Washington.
As they say, "Caesar's wife must be above suspicion" - especially when one goes to congress asking for a multibillion-dollar loan... (Picture: Carscoop)
Automaker's Statements:
Ford Motor Company
"Ford welcomes the opportunity to provide our plan to Congress. We have a great plan that will continue Ford's transformation into a lean, profitable company that delivers the safe, fuel-efficient, high-quality new products that our customers want and value."
Chrysler LLC
"Chrysler LLC appreciated the opportunity to appear before Congress the past two days and looks forward to reviewing its plan in detail, in the near future. The Company is prepared to meet the "accountability and viability" criteria laid out today and is ready to provide its plans for returning Chrysler to profitability, as we move beyond this unprecedented financial crisis. Chrysler is changing and will continue to change."
General Motors
"We will continue to work vigorously with the Congress and the administration during the next few weeks to address their concerns and to arrive at a solution that provides immediate aid to the auto industry."
